Good Morning! Hope everyone had a wonderful Christmas! Prices fell for the first time since April 2020, and investors are celebrating the “soft landing.” A former Two Sigma researcher is fighting the hedge fund over blame for a $170 million loss. British billionaire Jim Ratcliffe bought a 25% stake in Manchester United, and OpenAI is in the market to raise fresh funding at a $100 billion valuation. Plus the reasons why everyone was dead wrong about the 2023 economy, and how to crank up your efficiency and productivity at work.

Today's edition is presented by Eckard, a company specializing in investment opportunities that focus on mineral rights, delivering passive income returns of over 16%.

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UBS Aiming to be Mid

UBS President Rob Karofsky has an unusual goal - he wants UBS to become the No. 6 investment bank in the U.S.

It might seem odd at surface level - after all, who’s really settling to be mid? But UBS has tried breaking into the U.S. investment-banking scene before and failed. In 2022, UBS took the #25 spot in the Americas and the combined UBS-Credit Suisse stands at #12 this year (YTD December 14th, chart below)

And a European investment bank hasn’t cracked the Top 5 of investment banks (by total revenue) since Deutsche Bank did in 2014.

Barclays has been successful as a European bank acquiring a failing investment bank (RIP Lehman Bros) and is the current European leader, coming in at #7 in the revenue league tables this year.

UBS is trying to copy a page of the Barclays playbook and also poaching its bankers. It’s hired more than 10 senior bankers from Barclays and grown its coverage MD class to more than 100, up from 60, including 30 from Credit Suisse.

UBS is primarily a wealth-management powerhouse - and the bank wants to stay true to its roots, even after the Credit Suisse acquisition. UBS only allocates 25% of the firms’ assets to investment banking.

Takeaway: UBS’s investors and Swiss regulators aren’t necessarily encouraging the bank to make a push towards investment banking. But if 2024 is the dealmaking comeback that rainmakers are hoping for, it could be a great opportunity for UBS to solidify a post-merger path forward.

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Top Reads

• Prices fell last month for the first time since April 2020 (CNN)

• Two Sigma researcher fights hedge fund over blame for $170 million loss (YF)

• Private equity hiring, pay expected to be stable in 2024 (WSJ)

• Nike should focus on tackling competition from upstart brands (YF)

• Software engineers are more valuable than capital, but AI might change that (CNBC)

• US new home sales fell to one-year low in November (YF)

• Warburg Pincus turned to fellow private equity firm Apollo for $1 billion loan (BB)

• Wall Street short seller takes aim at Blackstone Mortgage Trust (YF)

• Why everyone was so wrong about the 2023 economy (Axios)

• Where the 100k laid-off tech workers ended up (CNBC)

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Markets Rundown

Markets were closed on Christmas.

Movers & Shakers

• (+) Rocket Lab ($RKLB) +23% because the space company won a $515 million government contract.

• (+) Coinbase ($COIN) +4% after a double-upgrade by JPMorgan.

• (–) Nike ($NKE) -12% after the company announced weak revenue, cost-cutting initiatives.

Private Dealmaking

• Bristol Myers will buy Karuna Therapeutics for $14 billion

• Lionsgate will spin off its studio business in a $4.6 billion SPAC deal

• Blackstone bought a majority stake in Sony Payment for $280 million

• Lightmatter, a photonic computing company, raised $155 million

• Harvey, an AI legal startup, raised $80 million

• Unnatural Products, a computational biology startup, raised $32 million

For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.

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How To Expect The Unexpected

How can you be 100 percent sure you will win a bet? Why did so many Pompeians stay put while Mount Vesuvius was erupting? Are you more likely to work in a kitchen if your last name is Baker? Ever since the dawn of human civilization, we have been trying to make predictions about what the world has in store for us.

For just as long, we have been getting it wrong. In How to Expect the Unexpected, mathematician Kit Yates uncovers the surprising science that undergirds our predictions—and how we can use it to our advantage.    

From religious oracles to weather forecasters, and from politicians to economists, we are subjected to poor predictions all the time. Synthesizing results from math, biology, psychology, sociology, medicine, economic theory, and physics, Yates provides tools for readers to understand uncertainty and to recognize the cognitive biases that make accurate predictions so hard to come by.  

This book will teach you how and why predictions go wrong, help you to spot phony forecasts, and give you a better chance of getting your own predictions correct. 

“A guide for understanding how and why predictions go wrong, with practical tips to give you a better chance of getting them right.”

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Most Popular Wikipedia Articles 2023

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Simplify For Success

Ever struggled to explain complex ideas? Stanford lecturer Matt Abrahams shares four rules to simplify effectively:

Be Precise: Clarify goals before speaking. Consider what information you want them to know, how you want them to feel, and the action you want them to take.

Make It Relevant: Tailor your message to what's important and relevant to your audience. Always ask, "Why should they care?"

Use Accessible Language: Avoid complex words and jargon. Make your message easy to say and understand without dumbing it down.

Be Concise: Neurologists agree—conciseness improves message reception. Cut unnecessary words. Practice concise storytelling to prioritize essential information.

Remember, simplicity isn't about diluting content; it's about connecting effectively.

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Short Squeez Picks

• The most disliked office jargon

• Vox’s favorite books of 2023

• How to increase both efficiency and productivity at work

• Investment preferences charted by generation

• 12 daily reminders you should read every day

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Memes of the Day